What is the story about?
What's Happening?
Ryan Specialty has announced the creation of Ryan Alternative Capital Re, Ltd. (RAC Re), a new collateralized reinsurance vehicle. This initiative aims to provide additional capacity to Ryan Specialty Underwriting Managers' portfolio of syndicated delegated authority property and casualty insurance business. RAC Re is designed as a multi-year, multi-class vehicle that offers capacity for specialty catastrophe and non-catastrophe property and casualty risks. The vehicle has raised approximately $400 million in committed capital from funds managed by Flexpoint Ford and Sixth Street. It is expected to provide $900 million in multi-year premium capacity, supported by Axis Capital through its Lloyd's of London syndicate.
Why It's Important?
The launch of RAC Re represents a significant development in the reinsurance market, offering Ryan Specialty the ability to accelerate solution delivery and respond to market dislocation. This move is poised to enhance the company's delegated underwriting platform, potentially leading to increased growth and profitability. The collaboration with Axis Capital and investment from Flexpoint Ford and Sixth Street underscores the confidence in Ryan Specialty's strategy and the potential for expansion in the specialty insurance sector. This development could influence the competitive landscape, encouraging other insurers to explore similar innovative reinsurance solutions.
What's Next?
Ryan Specialty's new sidecar is expected to drive growth in its delegated underwriting platform, with RAC Re providing substantial capacity over the coming years. The partnership with Axis Capital may lead to further strategic collaborations, expanding Ryan Specialty's reach into targeted markets. As the reinsurance vehicle begins operations, stakeholders will be watching for its impact on the market and potential adjustments in underwriting strategies. The success of RAC Re could set a precedent for similar initiatives in the industry.
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